Market Update: Decision Time!

As the market continues to seek out its maximum stupid price limit, it’s now decision time for investors.

If you’re still long stocks and bonds at this point: Do you now sell to protect your gains?

If you’re skeptical of today’s prices and sitting in cash: Is now the right time to start shorting the market?

If you’ve recently been laid off: Do any of the new options offered by the CARES Act that enable you to access retirement funds without penalty make sense for you?

With markets this overextended, your window of time to take action will likely be quite brief. An end to the currently rally could happen extremely quickly and brutally.

What make us say this? Because here’s an example of the level of overvaluation we’re dealing with:

Russell 2000 P/E ratio chart

The Russell 2000 index — at a P/E ratio of 70x(!!) — has never been so richly valued. Remember: these are the smaller, weaker publicly traded companies, a material number of which will likely be going bankrupt later this year.

Over 40 million US workers laid off (so far). Q2 2020 GDP now expected to be down over -50%(!!). And half of all US small businesses expected to close down permanently.

And if you believe that fundamentals don’t matter, that only Fed liquidity does; note that the Fed’s buying spree has been tapering off for a month now:

Fed Treasury/MBS purchases

Without sufficient liquidity, how long can the market remain at these ridiculous prices?

Not long, we predict. Which is why time is now of the essence.

As we do each week, we’ve once again asked the lead partners at New Harbor Financial, Peak Prosperity’s endorsed financial advisor, to share their latest insights into the road ahead for investors.

In the below video, we address the risks and rewards offered by shorting the market, retirement fund tapping/rollover strategies, and how the Fed is inflaming societal instability as it continues to dangerously deform prices:

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Anyone interested in scheduling a free consultation and portfolio review with Mike and John can do so by clicking here.

And if you’re one of the many readers brand new to Peak Prosperity over the past few months, we strongly urge you get your financial situation in order in parallel with your ongoing physical coronavirus preparations.

We recommend you do so in partnership with a professional financial advisor who understands the macro risks to the market that we discuss on this website. If you’ve already got one, great.

But if not, consider talking to the team at New Harbor. We’ve set up this ‘free consultation’ relationship with them to help folks exactly like you.

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